Use of Projected Future Conditions Appropriate Baseline for Analyzing Impacts of Long-Term Infrastructure Projects

Neighbors for Smart Rail v. Exposition Metro Line Construction Authority, et al., B232655 (2nd Dist. Div. 8, April 17, 2012)

[author: Daniel Bane]

In Neighbors for Smart Rail v. Exposition Metro Line Construction Authority, et al. (“Neighbors for Smart Rail”), the California Court of Appeal for the Second District considered plaintiff and appellant Neighbors for Smart Rail’s (“Petitioner”) claim that defendants and respondents Exposition Metro Line Construction Authority, et al. (“Expo Authority”) abused their discretion in certifying the final environmental impact report (“EIR”) for the second phase of the construction of a light rail line along the Exposition Corridor connecting downtown Los Angeles with Santa Monica (the “Project”) because – in addition to other perceived deficiencies - the Expo Authority used an improper baseline for analyzing the impacts of the Project on traffic, air quality and greenhouse gas emissions. However, Petitioner’s claims were wholly rejected. Specifically, the Court of Appeal held that an agency’s use of a projected future baseline, when supported by substantial evidence, is an appropriate means to analyze the traffic and air quality effects of a long-term infrastructure project. In so holding, the California Court of Appeal for the Second District vehemently rejected the recent holdings of their colleagues in the Fifth and Sixth Districts in Madera Oversight Coalition, Inc. v. County of Madera (2011) 199 Cal.App.4th 48, 90 (“Madera”) and Sunnyvale West Neighborhood Assn. v. City of Sunnyvale City Council (2010) 190 Cal.App.4th 1351, 1382-1383 (“Sunnyvale”) to the extent they eliminated a lead agency’s discretion under any circumstances to adopt a baseline that uses projected future conditions.

Factual and Procedural Background

On February 4, 2010, the Expo Authority certified the EIR and approved the Project, which included the adoption of detailed findings of fact, a statement of overriding considerations, and a mitigation monitoring and reporting program. Following the certification of the EIR and approval of the Project, Petitioner sought a writ of mandate invalidating the Expo Authority’s certification of the EIR and setting aside the approval of the Project on, among others, the grounds that the Expo Authority used an improper baseline for analyzing the impacts of the project. However, the trial court denied the petition for a writ of mandate and Petitioner appealed.

On appeal, Petitioner argued that the EIR was legally inadequate as an informational document because: (1) the Expo Authority improperly used hypothetical future conditions as the baseline for analyzing the environmental impacts of the Project; (2) the traffic analysis failed to address potential traffic impacts; (3) the analysis of growth-inducing impacts did not discuss the potential impacts of concentrating new development around the planned transit stations; (4) analysis of cumulative traffic impacts did not consider the localized traffic impacts of related projects; (5) mitigation measures were inadequate and improperly deferred; and (6) the EIR failed to adequately evaluate feasible project alternatives. Despite Petitioner’s various contentions, the most noteworthy issue addressed and decided by the Court of Appeal was whether the Expo Authority’s use of a projected future baseline for the Project was permissible under the California Environmental Quality Act (“CEQA”) (Pub. Resources Code, § 21000 et seq.) and the corresponding CEQA Guidelines (Cal. Code Regs., tit.14, § 15000 et seq.) – specifically CEQA Guideline §15125, subd. (a).

The Baseline Issue

The crux of Petitioner’s baseline argument in Neighbors for Smart Rail was that the Expo Authority used an improper baseline for analyzing the impacts of the project on traffic, air quality and greenhouse gas emissions because the Expo Authority improperly evaluated the significance of those environmental impacts using baseline conditions as they were projected to exist in 2030. Instead, Petitioner believed the Expo Authority should have used baseline conditions that existed sometime between 2007, when the notice of preparation for the Project was filed, and 2010, when the Expo Authority certified the EIR. In support of its argument, Petitioner relied heavily on Madera and Sunnyvale, both of which previously held it is improper to use predicted conditions on a date after EIR certification or project approval as the baseline for assessing environmental impacts.

The court declined to follow Madera and Sunnyvale holding instead that, in a proper case and when supported by substantial evidence, use of projected conditions is well within a lead agency’s discretion and is an appropriate way to measure the environmental impacts that a project will have on traffic, air quality and greenhouse gas emissions. Regarding the Project, the court reasoned that “[a]s a major transportation infrastructure project that will not even begin to operate until 2015 at the earliest, its impact on presently existing traffic and air quality conditions will yield no practical information to decision makers or the public.” The court further declared that “[a] decision to measure environmental effects of a long-term project by looking at those effects in the long term is neither hypothetical nor illusory. It is a realistic and rational decision.”

In support of its holding, the court was careful to note that the pertinent CEQA Guideline states that publication of the notice of preparation of an EIR or the beginning of environmental analysis “will normally constitute the baseline physical conditions by which a lead agency determines whether an impact is significant.” (CEQA Guidelines, §15125, subd. (a), emphasis added.) The court surmised that “[t]o state the norm is to recognize the possibility of departure from the norm” under appropriate circumstances. Based on the substantial evidence in the record, the court believed such a departure from the norm was warranted in Neighbors for Smart Rail. However, while the court declined to follow Madera and Sunnyvale, it was careful to limit its holding to an agency’s use of projected future baselines as an appropriate means to analyze the traffic and air quality effects of a long-term infrastructure project. Thus, it remains an open question whether or not other factual circumstances or conditions may warrant the use of projected future conditions for projects other than long-term infrastructure projects. In any event, guidance regarding such other factual circumstances, to the extent any exist, is likely to be provided solely on a case-by-case basis in the years to come.

Due to the apparent disagreement amongst the various Court of Appeal Districts regarding the propriety of using projected future baselines in CEQA analyses, it appears California Supreme Court guidance on this issue is likely forthcoming. In the meantime, practitioners in Appellate Districts other than the Second, Fifth and Sixth Districts would be wise to take a conservative approach regarding the use of projected future baselines for long-term infrastructure projects by ensuring that these baselines are “realistic” and not “hypothetical” in nature, represent “on the ground” conditions, and are firmly supported by substantial record evidence.